SAN FRANCISCO -- Microsoft is edging closer to a final RTW (Release to Web) of its Internet Explorer 9 browser, showcasing features in the new Release Candidate of IE9 at a media event here today. The IE RC is available for free download. While it's still accepting feedback from developers and users, the RC is considered feature complete with no significant changes expected in the RTW.

A number of improvements and new features were demoed by Microsoft (NASDAQ: MSFT) and partners including user interface improvements, hardware acceleration tied to PCs running Windows 7 and expanded privacy controls.

The news comes as Microsoft is pushing hard to regain the market-leading IE's momentum in the face of competitors like Google's Chrome and Firefox.

"It's a battle Microsoft can't afford to lose because the browser is the gateway to the Web's present and future," Gartner analyst Ray Valdes told InternetNews.com. "Chrome has a lot of momentum, but Firefox has kind of stalled."

While Microsoft has had to play catch up in some areas compared to other browsers, like support for the media rich HTML5, IE9 now fully supports HTML5 and is leading the way in other areas including a Do Not Track feature that gives users more control over what data is collected on their browsing sessions by third-parties. IE9 also offers more complete hardware acceleration features to boost performance than competing browsers.

"Eleven months ago performance was about page load times. Today page load time feels very 2010," said Ryan Gavin, Microsoft's senior director of Internet Explorer. "Now you can't have a conversation about performance without talking about hardware acceleration capabilities."

Gavin said IE9 with hardware acceleration is designed to give the snappy performance of an application running natively on a PC. Several media rich game demos did show impressive performance.

"In the gaming world, that's going to be significant," said Valdes. "But in the beta I've been running, and for the websites the average user is going to go to, the hardware acceleration isn't making much of a difference. We'll have to see how it looks in the final release."

Pinned Sites is a unique feature in IE that lets users "pin" favorite sites as icons on the task bar for easy access. But beyond just a handy alternative to bookmarks, Pinned Sites have a notification feature so, for example, a Pinned Site icon might pulsate when there's been an update to the site. The fashion site Gilt.com is already using the feature as a way for visitors to be alerted to limited time sales that sometimes only last a few hours.

"The speed is great because you can just hover over the Pinned Sites to see what's there," Chris Maliway, vice president of product management at Gilt.com, told InternetNews.com. "It lets our customers react quickly to buy items that often can sell out."

On the privacy front, IE9's Do Not Track feature gives users the ability to prevent third party firms from tracking and collecting information on their Web surfing. But it also offers controls to fine-tune the experience to allow users to allow a level of tracking if desired. "This is an important tool because we don't think consumers necessarily want a total block of all tracking activity which would, for example, prevent them from getting more relevant ads," Jim Brock, founder and CEO of Privacy Choice told InternetNews.com.

Privacy Choice and others, including TRUSTe, are offering tracking lists designed to let IE9 users limit tracking activity to companies that adhere to these organizations privacy standards.

"TRUSTed TPL gives IE9 users the choice to interact with companies that maintain the highest privacy standards -- as validated by the most widely recognized authority in online privacy," Kevin Trilli, vice president of product management at TRUSTe," said in a statement. "Using a pragmatic approach, our list allows consumers to choose to receive relevant ads from credible companies that demonstrate respect for consumer privacy, while also giving the option to block those companies that do not."

Gartner's Valdez said he's impressed with the progress Microsoft's made with IE9. "They're pursuing the right strategy and they're on the right trajectory," he said. "Privacy controls aren't an obvious benefit, particularly when you look at what people are willing to reveal on Facebook, but it's a very important issue."

Microsoft said there have been over 25 million downloads of IE9 since its release last year.

David Needle is the West Coast bureau chief at InternetNews.com, the news service of Internet.com, the network for technology professionals.